Whether you’re a young, aspiring entrepreneur or a successful leader in academia, you depend on your customers and clients to pay on time, every time, and you need straightforward policies and processes to make that happen. If your customers are late with their payments, your business has to handle the situation with kid gloves because the last thing you want to do is lose a customer. Here are some tips for how to tackle late payments without offending your clients.
By Julie Morris, Guest Contributor and Author
Attempt to Avoid Late Payments in the First Place
In a dream world, your customers will always pay on time and you’ll never have an issue, but that is not reality. However, you can get as close to that as possible by creating a clear and concise payment policy and placing it on your website and your invoices. Yonyx points out that this policy should list all acceptable payment methods and spell out your terms, such as when a payment will be considered late and penalties if a late payment does occur.
Your payment policy should also be clearly stated in all documents that your client or customers receive when they first start working with your company. If the amount of money in question is significant, you may want to work with an attorney to write up a contract. Be sure to work with the business partner during this process so that the document is fair to both parties.
The point is that you want something to point to if a customer is late with the hope that they will understand their obligation and complete the payment ASAP. When customers or clients are late with payments, make sure you’ve sent the invoice to the right person, coordinate your invoicing with the customer’s billing cycles, and/or offer a discount for quick payment. You can also spruce up your invoices to make them more memorable by using a free invoice generator to create a branded invoice that leaves a more professional impression.
It is also a smart idea to invest in payroll software that can properly process and organize payments so you know which clients have paid and which have not. The last thing you want to do is accuse a customer of being late when you actually have received their payment and it slipped through the cracks.
Another way to ensure timely payments is to make it easier for your clients and customers to pay you. When you accept payments through your app, you’ll simplify the payment process, but you need to ensure that your customers’ sensitive financial information is protected. Fortunately, you can use a tool to authenticate bank account information for secure payments.